The Boon & Bane of Maquiladoras


The Maquiladora industry is a term that is used to describe the multinational factories that hire sweatshop labor from Central America to Far East. The original set of maquiladora industries were, however, started as a legal entity since the mid 1960’s and dotted the landscape in Us-Mexico border cities like Tijuana and Ciudad Juarez. Despite the increasing manufacturing activities in China in the 21st century, Mexico still remains very attractive for foreign direct investment. In fact, these industries are still described as a symbol for workers’ progress and development, although there are many facts that imply the opposite.

The maquiladoras are mostly American-owned factories, situated along the 2,000 mile border between US-Mexico. These industries are said to have brought boon to Mexican economy and the maquiladoras have grown significantly to an extent that it is the second largest contributor to Mexico’s foreign exchange earnings (following petroleum). Numerous articles and books were written on the maquiladoras’ impact on the North American economy. The maquiladoras came into existence due to Mexican legislation allowing duty-free importation of raw materials and components for processing and assembly with eventual export to the US.


Economists point out that the maquiladoras aren’t just a program aimed at enamoring cheap Mexican or Central American labor to work for the increasingly booming US economy. They state that the image of labor force slaving around assembly plants is not the only face of maquiladora. Many industries have of course changed from being an assembly plant to manufacturing plant and then oriented toward research, design and development. But, that image of hard-working, low paid workers piecing through branded apparels or footwear has created an indelible impression. A 2014 statistics by labor and social organizations, taken in Central American nations like Guatemala, Honduras and El Salvador state that around 45 to 70 percent of these nations’ export products to US are produced by maquiladora workers.


US Office of Textiles and Apparel data showcases that nearly 70 percent of US apparel goods are produced in Mexico and Central American nations. Only a handful of multinationals control these apparel export industries of Central America. Nike, Adidas, Loom, Hanes and Gildan Active wear are some of the biggest North American corporations employing at least 35-40 percent of maquiladora workers in the aforementioned countries. Maquiladora solidarity Network has recently published the low purchasing power of these corporations. The US daily minimum wage as per 2015 government stats hovers around 50-55 dollars, whereas the daily wages for workers employed in maquiladora-based manufacturing are between 1 an 8 dollars. In nations like El Salvador, the average daily wages are between 1 and 4 dollars.

Mexico-USA border

Mexico-USA border

The United Nations expressed concern over the daily wages in maquilas, but the governments in Central America keeps on bringing down the minimum wages to not lose the multinational manufacturers. Both the US and Central American governments view the migration crisis in countries like Mexico, Honduras, Guatemala, etc as a different problem that has no link whatsoever with the dwindling minimum wages. US views the migration crisis simply as a security problem and would be elated if the regions are militarized since it may not only contain outward migration, but also help its multinationals to tap onto the unbridled source of low-wage workers. The maquiladoras in the 21st century aren’t just used as an intrigue to gain immense profit; it is also used as a strategic testing ground by multinationals to impose new sinister methods for depriving workers’ unionization. Nevertheless, despite the sexual harassment, threats and firings, union activities and solidarity programs continue in the maquiladoras.